Nio Inc (NYSE: NIO) rallied about 10% late on Thursday following news that its sub-brand Onvo saw its newly launched L90 electric SUV got sold out in less than three hours.
L90’s launch event in Hangzhou concluded Thursday night – and shortly after, the online configurator went live, triggering a wave of orders that reportedly locked in around 10,000 units.
With CEO William Li targeting more than 7,000 deliveries in the first month, the early momentum suggests that goal may be well within reach.
Including today’s rally, Nio stock is up nearly 50% versus its recent low (July 7th).
Why does it matter for Nio stock?
L90’s explosive debut signals much more than just a successful product launch – it marks a potential turning point for Nio’s broader strategy.
After facing intense competition and margin pressure in China’s EV market, the company’s pivot toward the family-oriented segment via Onvo appears to be resonating well with customers.
Investors are interpreting the sellout as validation of Nio’s multi-brand approach, which aims to capture different consumer demographics while leveraging shared technology platforms.
With nearly 1,000 test drive vehicles now deployed and strong initial demand, analysts may revise delivery forecasts upward – potentially leading to continued momentum in NIO shares.
If sustained, this momentum could help Nio regain investor confidence and improve its valuation metrics, which have lagged behind peers like Li Auto and BYD.
Why is the Onvo L90 selling like hot cakes?
Onvo L90’s appeal lies in its strategic blend of affordability, spacious design, and flexible battery options.
Priced at 265,800 yuan with an 85-kWh battery – or just 179,800 yuan under Nio’s battery-as-a-service (BaaS) model – it undercuts rivals like Li Auto’s L8 and Xiaomi’s SU7, while offering comparable tech and comfort.
The six-seat layout caters directly to family buyers, a segment underserved by most EV makers. Unlike Xiaomi’s SU7, which targets performance enthusiasts, the L90 focuses on practicality and user experience.
Onvo’s fast deployment of test drive vehicles and streamlined ordering process also helped convert interest into sales quickly. Simply put, it’s a well-timed product that fills a clear market gap – and stands to unlock significant further upside in NIO stock over time.
Is it too late to buy Nio shares?
While the L90 enthusiasm has already triggered a significant rally in NIO shares, it’s worth noting that this Chinese electric vehicle maker, nonetheless, is in its early innings only.
Plus, the EV stock is currently going for a price-to-sale (P/S) ratio of 1.09 only, which is materially below its domestic rivals.
If Onvo continues to gain traction and Nio maintains operational discipline, the upside could be significant.
Note that this L90-driven interest in the company’s long-term potential is keeping Wall Street bullish on NIO stock, with the consensus rating at “overweight” at the time of writing.
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